Another One Bites The Dust!

Concern about the future of independent electricity suppliers grew yesterday after BizzEnergy went into administration and its 40,000 small and medium sized business customers were "sold" for the princely sum of £87.50 each.

British Gas Business, part of Centrica, the international energy group, agreed to pay £3.5m cash for the customer base and maintain the same contract terms shortly after BizzEnergy ceased trading following the failure to attract new funding. Administrative receivers from KPMG handled the deal but 129 out of a workforce of 168 have lost their jobs.

The company is the second independent supplier to collapse in the last two weeks. Electricity4Business (E4B), another small business supplier with 40,000 customers, went into administration after failing to find fresh financial support and struggling to compete in a volatile market.

BizzEnergy, founded in 2000 and still headed by John Devaney, chairman of National Air Traffic Control Services, former chairman of Marconi, Eastern Electricity, Exel, and non-executive director of Northern Rock, claimed to be the biggest independent electricity supplier. Turnover last year topped £175m.

Ofgem, the gas and electricity regulator, is closely monitoring developments amid fears that other small suppliers will go under in a market where the "Big Six" - British Gas, EDF, RWE, E.On, Scottish & Southern and Scottish Power - have tightened their grip.

The regulator has expressed concern about the fairness of small business deals after being told many customers were unaware of contract terms covering a change of supplier. Conditions covering the roll over of contracts are being used by suppliers to lock in small customers said the regulator in a call for reforms to prevent abuses of competition.

Independent suppliers without any capacity to generate power have been at the mercy of the markets and rapidly fluctuating prices. Many small businesses attracted by three year contracts signed up for fixed price deals but their suppliers have had difficulty in finding extra sources of finance to hedge in difficult markets to renew contracts.

Customers with E4B were switched to British Gas by Ofgem without the protection provided by their contracts because E4B had been unable to find a buyer. They were placed on what British Gas maintains is a competitive rate but have the freedom to shop around for cheaper supplies.

The BizzEnergy customers have more breathing space but service advisers say some could face increases of 50pc or more as long-term contracts, struck when prices were lower, come to an end.


It is more important than ever that customers shop around and seek good advice regarding their energy supplies.

One consequence of Bizz Energy going bust is that the customer service (from British Gas!) should dramatically improve!............and also that British Gas might take action regarding the mis-selling that has been associated with the Bizz Energy brand. (type Bizz Energy complaints into google for more information)